investigating and building a criminal elder financial abuse case candace heisler kathy van olst...

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Investigating and Building a Criminal Elder Financial Abuse Case

Candace HeislerKathy Van Olst

Seattle Elder Abuse ConferenceOctober 30, 2014

Van Olst and Heisler, 2014

Van Olst and Heisler, 2014 2

This presentation is derived from case materials developed by Page

Ulrey, Kathy Van Olst, and Candace Heisler.


Challenges

• Capacity, past and present• Consent and undue influence• Legal instruments convey authority to act• “Gifting” in POA cases• Finding the evidence• Assets often already gone


Leonard

• 66 years old• Married for 30+ years, with 3 children• Disabilities– Developmentally delayed– Physical disabilities

• Employed full-time• Financially stable• Wife handled all finances


Leonard

• In 2005, wife killed in auto accident

• Leonard begins to handle own finances with help from daughter

• Starts going to Classics Sports Bar after work


August 2006

• At bar, Lisa O’Neill introduces herself to Leonard–42 years old–Attractive– Long-term boyfriend– In debt

Aug2006

2011


August 2006

• O’Neill asks Leonard to come over to her house

• Asks him to spend the night in her basement• Within a few weeks, asks him to move into her

basement• Leonard agrees

Aug2006

2011


August 2006

• Leonard moves into bedroom in basement• Next to Leonard’s room is O’Neill’s caged

African serval cat

Aug2006

2011


September 2006

• O’Neill begins to ask Leonard for money– To pay off $23,000 truck loan– To buy her a new computer– To pay off other debts

• Leonard agrees

Aug2006

2011Sep2006


October 2006

• Tells Leonard they need to move his money to her bank, as it will “do better there”

• At bank, Leonard’s daughter attempts to intervene, calls police

• Officer does not take report, says case is “civil”

Aug2006

2011Oct2006


October 2006

• Abuse by O’Neill begins– Isolates him– Emotionally abuses him– Leads him to believe no one else cares about

him– Eventually becomes physically abusive

Aug2006

2011Oct2006


January 2007

• Leonard suffers a stroke and is hospitalized

– Speech is impaired, left arm is weakened, probable increased cognitive impairment

• Returns to live with O’Neill

• Does not follow through on follow-up doctor’s visits, physical and speech therapy, medications

Aug2006

2011Jan2007


October 2006 – July 2008

• O’Neill moves Leonard’s accounts to a third bank

• Cashes out his CDs totaling $90,000• Cashes out his life insurance policies• Stops paying his mortgage

Aug2006

2011Jul2008


July 1-10, 2008

• O’Neill shoves Leonard down the stairs, leaves him there

• 7/10/08: O’Neill and friends tease Leonard, allow serval to run loose in house

Aug2006

2011Jul2008


July 11, 2008

• Leonard leaves D’s home at 5:30 a.m.

• Walks miles to friend’s house

• Brings with him only remaining possessions

Aug2006

2011Jul2008


July 2008

• Leonard reunites with children• Case reported to APS– APS concludes Leonard is not a “Vulnerable Adult”

and closes case• Daughter takes Leonard to precinct• Brings with her all of Leonard’s bills and

financial documents• Detective assigned

Aug2006

2011Jul2008


Discussion

• What do you have?

• What needs to be done?

• Who needs to be involved?


Meeting with the Detective

• Leonard is slow to respond• Has impaired speech• Is unable to recall significant details• Had a stroke in January 2007 affecting his speech and

left side of his body• Is no longer able to work at long-time job• “She did everything so fast. I didn’t have time to

think.”


Class Discussion

• What issues does this information raise for your investigation?

• How will you address them?


Dementia

• A general term used to describe disorders that cause significant decline in two or more areas of cognitive functioning

• One of these areas must be severe enough to cause functional decline

• Not a normal part of aging• Even if dementia, person may still be able to provide

information and/or testify


Medications

• May be evidence of dementia diagnosis:–Aricept (Donepezil)–Namenda (Memantine)–Exelon (Rivastigmine)–Razadyne (Galantamine)

• May be tools of compliance or abuse• May make person appear more demented


Capacity

• Clinical term and assessment made by psychologist or psychiatrist

• Not a legal determination (vs diminished capacity)• Focuses on person’s abilities, what he/she can do– Whether can handle finances, make medical

decisions– Whether a person can consent

• May have capacity to do one thing, but not another


Mental Capacity

• Depends on:•Working memory• Executive function


Executive Function

• Judgment– Ability to plan and evaluate steps and alternatives,

and carry out plan– Ability to process information and modulate affect

• Requires alertness and attention• Critical in financial transactions• Person can have deficits in executive function

without having dementia or memory impairment (Dyer et al)

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Financial Capacity

• One of the first abilities to decline as mild cognitive impairment (MCI) and early dementia occur– Triebel et al, 2009; Widera, Steenpass, Marson & Sudore (2011)

• Amnestic MCI at high risk of progressing to Alzheimer’s Disease

• Older adults may suffer impaired judgment even without a dementia diagnosis– Diagnosis of dementia can occur well after onset of cognitive

impairment

– Declining skills are often detectable before a diagnosis of dementia


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Financial Capacity

• “The capacity to manage money and financial assets in ways that meet a person’s needs and which are consistent with his or her values and self interest.”– Marson, Hebert, and Solomon, 2011; Marson and

Sabatino, 2012

• Decline in an older adult’s financial skills can be an early warning sign of impending Alzheimer’s type dementia– Marson and Sabatino, 2012



If Concerns About Victim’s Capacity

• Conduct a short videotaped interview in addition to taking a statement– Part 1: General questions about victim to establish

degree of memory loss or confusion– Part 2: Impact of crime on victim

• Take detailed, tape recorded statement about facts of case

• Obtain capacity evaluation by a qualified expert as soon as possible

• Don’t allow your investigation to languish


January 2010

• Detective obtains capacity evaluation of Leonard

• Diagnosis: Vascular dementia• 27/30 on MMSE• Impaired executive function• Concludes: – Leonard lacks financial capacity– Likely victim of undue influence

Aug2006 2011Jan

2010

Charges

• What are the most likely charges in the O’Neill case?



Relevant Washington Crimes

• Theft

• Identify theft

• Forgery

• Assault 4 domestic violence


Thinking About Defenses

• What defenses will O’Neill claim?

• Why Is This Important To Consider At The Outset Of The Investigation?


Common Defenses in Financial Exploitation Cases

• Consent–Gift– Loan – Salary–Rent

• Entitlement• Denial


Funds in Joint Bank Accounts

• Funds on deposit in a joint bank account belong to each depositor in proportion to their ownership of the funds.

• A joint bank account holder may have the right to withdraw funds, but this does not mean that the joint bank account holder owns the funds.

RCW 30.22.090


Consent

• Capacity

• Knowledge of the true nature of the act

• Freely and voluntarily given


Consent is Not Freely Given When:

• Obtained by deception–Assets given to suspect based on

lies/misrepresentations suspect tells victim• Victim lacks mental capacity• Obtained by undue influence


July 2008 – January 2010

• APS finds Leonard is not a vulnerable adult– Is oriented x3– Is able to conduct basic ADLs without assistance

• Detective brings prosecutor in for victim interview• Criminal investigation expands to address financial

exploitation• 1 1/2 - year criminal investigation – Search warrants for financial and medical records

Aug2006

Jan2010

2011


Leonard’s Interview, He Discloses

– O’Neill stopped paying his phone bill, causing him to lose his cell phone

– O’Neill stopped making his truck payments and returned his truck to the dealer

– O’Neill convinced him his children were after his money, and he shouldn’t have any contact with him

– Over time, O’Neill became increasingly verbally and physically abusive to him• Name calling, verbal bullying, provoking fear


Undue Influence

• Pattern of manipulative behaviors similar to “grooming”

• Involving victims with and without cognitive impairments

• Used in order to obtain victim’s “consent” to turn over assets


How is UI perpetrated?

• Array of tactics to take over victim’s free will (“cult of one”) including:– Isolate from others and information–Undermine relationships–Prey on vulnerabilities and create

dependencies – Induce fear, paranoia


Relationship Between Consent and Undue Influence

• In a criminal case, is used by State to explain how victim’s “consent” was obtained by suspect/defendant

• Real vs. Apparent Consent

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Power of Attorney



Power of Attorney

• A written instrument in which one person, the principal, appoints another, the attorney-in-fact (or agent), to perform certain acts on the principal’s behalf

• Does not deprive principal of ability to act• Usually are notarized• Not required to be filed or registered • Check Recorder’s Office

• Not monitored by a court


Power of Attorney Limitations

• Attorney in fact (agent) has a duty of due diligence, faithful service, and fair dealing with the principal– May not make a gift of principal’s assets unless POA

specifically authorizes– Cannot make a loan to self unless specifically authorized in

the POA

• Is not a license to steal• Abuse of Power of Attorney is Theft


Types of POAs

Health care Financial Durable power of attorney

Goes into effect when signed Operates even after incapacity Lasts until revoked or principal’s death

Springing durable power of attorney Goes into effect only after a particular event occurs,

usually incapacity


Legal Instruments --The Investigation

• Secure a copy of actual instrument• Determine exact authority conferred• Elder’s capacity when instrument executed essential

to determining whether document is valid• May be parallel criminal and civil proceedings– Court-ordered accountings– Depositions and other discovery


Legal Instruments – The Investigation

• Often an attorney present when instrument signed– Critical witness– What information can attorney provide about elder’s

capacity?– Attorney’s file may be obtainable if represented elder– Who found the lawyer?– Who paid the lawyer?– Who was present when the documents were discussed

and signed?


Class Discussion

• Who are the potential witnesses in the O’Neill case?


Potential Witnesses in a Financial Exploitation Case

• Victim• Suspect• Family and friends (victim and suspect)• Neighbors• Co-workers• Bank tellers• Witnesses to interactions between suspect and victim• Victim’s accountant, bill payer• Civil attorney


Potential Witnesses in a Financial Exploitation Case

• Guardian ad litem, Conservator• Treating physician• APS worker• Officers on any prior reports involving suspect, victim• If legal documents were signed, Notary Public• EMTs, medical personnel if ER visits• Experts:– Capacity evaluator– Forensic accountant


Thinking About the Witnesses

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Lawyer

Neighbors

Doctor

Clergy Friends

FinancialAdvisor

CPA

Bank

Capacity Expert

Bill Payer

Trusted Advisors

Family

GALCo workers


Interviewing and Areas of Questioning

• Victim’s prior spending patterns• Victim’s gifting patterns• Changes in victim’s behavior since meeting suspect• Signs of victim’s vulnerability, cognitive impairment• Statements made by suspect, victim• Interactions witnessed between victim and suspect• Lies and misleading statements suspect told victim to

induce him/her to give suspect assets• Information suspect withheld from victim• Prior bad acts of suspect


Discussion

What are possible kinds of evidence in the O’Neill case or another financial

abuse case?


Possible Evidence in a FE Case

• Bank statements of suspect and victim• At least six months prior to beginning of takings

• Credit reports of both• Credit card statements• Power of Attorney document• Victim’s will• Conservatorship documents, including Court Report• Transcripts from prior hearings/trials

• Protection order• Conservatorship trial• Probate



• Victim’s insurance policies• Any handwritten or typed agreements between

victim and suspect• Victim’s checkbook, calendar• Other writings by victim, i.e. letters, journal, notes• Credit card records• Credit report• Safety Deposit Box• Receipts for recent purchases



• Treating physician and other medical records• Psych/Capacity evaluations• In-home health/hospice records• Records from long-term care facility• Prior police reports• Current and prior APS reports• Reverse mortgage documents• Suspect and Victim’s Facebook page• Suspect’s cell phone records



• Employment records for suspect• Toxicology screen for suspect and victim • Pharmacy records for victim• Overdue or unpaid bills• Suspect’s/Victim’s computer• Tax Records • Criminal History


Getting the Evidence

• How will you obtain the evidence you need?

• Are there any limitations you must consider?


Obtaining Evidence

• Use a release of information, unless capacity is in doubt*– Is there a surrogate decision maker?

• From APS • From civil attorney, conservator, attorney in

fact • Search warrant• Subpoena once case has been filed– Administrative subpoenas should not be used


HIPAA (Health Insurance Portability and Accountability Act of 2006)

• Intended to protect confidentiality of health care records

• Does not prevent mandated reporting of elder abuse, domestic violence, etc.– even if victim does not authorize

• Does not prevent disclosure of records by search warrant or subpoena

• See HIPAA Guide for Law Enforcement (2013) available at www.hhs.gov/ocr/privacy/hipaa/understanding/special/emergency/index.html

http://www.hhs.gov/ocr/privacy/hipaa/understanding/special/emergency/index.html

http://www.hhs.gov/ocr/privacy/hipaa/understanding/special/emergency/index.html


Making Financial Records Understandable

–Excel spreadsheets–Timelines–Spending patterns over time–Listing the checks and payee–“Story boards” that put relevant events

together


The Trial

• State of Washington v. Lisa O’Neill


Verdict

• Guilty: 14 counts of Theft 1 with vulnerable victim aggravators

• Not Guilty: Assault 4


O’Neill Case Unusual Because

• Victim was alive • Victim was capable of testifying• Psychiatric evaluation of victim was arranged

by law enforcement• Case was investigated and prosecuted despite

APS’ conclusion that Leonard not vulnerable and his apparent consent to taking of assets


Thank You

• Kathy Van Olst• [email protected]

• Candace Heisler• [email protected]

mailto:[email protected]

mailto:[email protected]

investigating and building a criminal elder financial abuse case candace heisler kathy van olst...

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